UPDATE 2-Merrill analyst sees Q4 loss at JPMorgan; cuts rating

Dec 15 (Reuters) - JPMorgan Chase & Co's (JPM.N: Cotización) near-term
earnings are likely to remain under pressure from worsening
consumer and corporate credit said a Merrill Lynch analyst, who
forecast a fourth-quarter loss and cut his rating on the stock.

The largest U.S. bank's shares were trading down 6.3
percent at $28.92 in morning trade on the New York Stock
Exchange. The stock has lost 29 percent of its value since
January.

"We do not believe the Street has rationalized the true
impact of expected economic woes on consumer credit, and
particularly what that means for JPM earnings," analyst Guy
Moszkowski wrote in a note to clients.

Moszkowski sees JPMorgan building reserves in a continually
worsening credit environment driven by a climbing unemployment
rate and cut his rating to "underperform" from "neutral."

Analyst Moszkowski, who expects another $2.8 billion
mark-to-market loss at the bank, reversed his fourth-quarter
estimates to a loss of 11 cents a share from his prior view of
25 cents a share.

In the third quarter, the bank had reported net markdowns
of $3.6 billion.

"While there is little doubt that JPMorgan will emerge from
the current crisis in a good competitive position, it is
increasingly clear that credit costs in the U.S. will get much
worse, particularly in cards and commercial lending", the
analyst said.